There have been several major accomplishments within the past fiscal year. First, nicotinic acetylcholine receptors (nAChRs) are expressed widely in the CNS, and mediate both synaptic and perisynaptic activities of endogenous cholinergic inputs and pharmacological actions of exogenous compounds (e.g., nicotine and choline). Behavioral studies indicate that nicotine improves such cognitive functions as learning and memory. However, the mechanism of nicotine's action on cognitive function remains elusive. We performed patch-clamp recordings from hippocampal CA3 pyramidal neurons to determine the effect of nicotine on mossy fiber glutamatergic synaptic transmission. We found that nicotine in combination with NS1738, an &#945;7 nAChR-positive allosteric modulator, strongly potentiated the amplitude of evoked EPSCs (eEPSCs), and reduced the EPSC paired-pulse ratio. The action of nicotine and NS1738 was mimicked by PNU-282987 (an &#945;7 nAChR agonist), and was absent in &#945;7 nAChR knock-out mice. These data indicate that activation of &#945;7 nAChRs was both necessary and sufficient to enhance the amplitude of eEPSCs. BAPTA applied postsynaptically failed to block the action of nicotine and NS1738, suggesting again a presynaptic action of the &#945;7 nAChRs. We also observed &#945;7 nAChR-mediated calcium rises at mossy fiber giant terminals, indicating the presence of functional &#945;7 nAChRs at presynaptic terminals. Furthermore, the addition of PNU-282987 enhanced action potential-dependent calcium transient at these terminals. Last, the potentiating effect of PNU-282987 on eEPSCs was abolished by inhibition of protein kinase A (PKA). Our findings indicate that activation of &#945;7 nAChRs at presynaptic sites, via a mechanism involving PKA, plays a critical role in enhancing synaptic efficiency of hippocampal mossy fiber transmission. Second, using mutagenesis and a combination of electrophysiology and imaging techniques, we discovered the possible involvement of an aspartate residue in the calcium permeability of the &#945;7 nAChR. We found that the aspartate at position 44 appears to be essential since mutating it to alanine resulted in the complete disappearance of detectable calcium changes in most cells, which indicates that the extracellular domain of the &#945;7 nAChR plays a key role in calcium permeation. Third, we have generated mice in which the fourth exon of the &#945;7 nAChR gene (Chrna7) is flanked by loxP sites (B6-Chrna7(LBDEx4007Ehs)) which we refer to as floxed &#945;7 nAChR conditional knockout or &#945;7nAChR(flox). We validated the chosen approach by mating &#945;7nAChR(flox) with mice expressing Cre recombinase driven by the glial acidic fibrillary protein (GFAP)-Cre promoter (GFAP-A7KO) to test whether &#945;7nAChR(flox), GFAP-A7KO and appropriate littermate controls performed equally in our standard Rodent In Vivo Assessment Core battery to assess general health, locomotion, emotional and cognitive behaviours. Neither &#945;7nAChR(flox) nor GFAP-A7KO exhibited significant differences from littermate controls in any of the baseline behavioural assessments we conducted, similar to the 'first generation' non-conditional A7KO mice. We also determined that &#945;7 nAChR binding sites were absent on GFAP-positive astrocytes in hippocampal slices obtained from GFAP-A7KO offspring from &#945;7nAChR(flox) and GFAP-Cre crosses. Finally, we validated that Cre recombinase (Cre)-mediated excision led to functional, cell- and tissue-specific loss of &#945;7 nAChRs by demonstrating that choline-induced &#945;7 nAChR currents were present in Cre-negative, but not synapsin promoter-driven Cre-positive, CA1 pyramidal neurons. Additionally, electrophysiological characterization of &#945;7 nAChR-mediated current traces was similar in terms of amplitude and time constants of decay (during desensitization) for the &#945;7nAChR(flox) and wild-type (WT) mice. Thus, we have in vivo and in vitro evidence that the Chrna7 exon 4 targeting strategy does not alter behavioural, cognitive, or electrophysiological properties compared to WT and that Cre-mediated excision is an effective approach to delete &#945;7 nAChR expression in a cell-specific manner.